"Stock investment" is a Ponzi Scheme? Personally, I think it is true. Specifically, we should admit that stock investment can be 'legally' used to implement Ponzi Scheme. In order to avoid to be a victim of Ponzi Scheme, there are two red flags that we should pay attention to.
All about the Future
Future is unknown and uncertain. If you find a particular stock (or business) have many "too good to be true" stories about the company's future prospect without any tangible evidence, then you may need to take a long breath and rationally analyse those stories in different perspectives.
Particularly, it is extremely dangarous when the main 'evidence' to support the stories is merely from the belief of people - fear and greed.
Only Good Prospect
I always believe that all things in this world have both sides - positive and negative. Thus, it is unnecessary for us to find a stock or business that only contains strength without any weakness.
All my invested businesses contain their weaknesses. If I cannot find any weakness of a particular business, the chance is I still haven't understood the business.
In other words, if somebody shares a stock or business with you without highlighting or knowing its weaknesses, then it is very likely that he or she is either ignorant or purposely hiding some crucial information.
That's all for today. I hope my sharing can help you spot any Ponzi Scheme and get rid of it. More fascinating articles and sharing will be updated weekly in Xaivier Blog. So, you are welcome to subscribe our feed to receive our latest sharing.
Written by: Xaivier Chia
P/S: The above sharing is solely based on personal insight and information that believed to be reliable. Your valuable feedback are very welcome.